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  • STUDY MATERIAL

    ENTERPRENEURSHIP DEVELOPMENT

    UNIT-1

    Concept of Entrepreneur ,Entrepreneurship

    The capacity and willingness to develop, organize and manage a business venture along with any ofits risks in order to make a profit. The most obvious example of entrepreneurship is the starting ofnew businesses.

    In economics,

    entrepreneurship combined with land, labor, natural Resources and capital can produce profit.Entrepreneurial spirit is characterized by innovation and risk-taking, and is an essential part ofa nation's ability to succeed in an ever changing and increasingly competitive global marketplace.

    Richard Cantillon

    : An entrepreneur is a person who pays a certain price for a product toresell it at an uncertain price,thereby making decisions about obtaining and using theresources while consequently admitting the risk ofenterprise.

    J.B. Say

    : An entrepreneur is an economic agent who unites all means of production- land of one, the labour ofanother and the capital of yet another and thus produces a product. Byselling the product in the market hepays rent of land, wages to labour, interest on capital andwhat remains is his profit. He shifts economicresources out of an area of lower and into anarea of higher productivity and greater yield.

    Schumpeter:

    According to him entrepreneurs are innovators who use a process of shatteringthe status quo of theexisting products and services, to set up new products, new services.

    David McClleland

    : An entrepreneur is a person with a high need for achievement [N-Ach]. He is energetic and a moderaterisk taker.

    Peter Drucker

    : An entrepreneur searches for change, responds to it and exploitsopportunities. Innovation is a specifictool of an entrepreneur hence an effective entrepreneur converts a source into a resource.

    Kilby:

    http://www.businessdictionary.com/definition/capacity.htmlhttp://www.businessdictionary.com/definition/develop.htmlhttp://www.businessdictionary.com/definition/manage.htmlhttp://www.businessdictionary.com/definition/business-venture.htmlhttp://www.businessdictionary.com/definition/risk.htmlhttp://www.businessdictionary.com/definition/order.htmlhttp://www.businessdictionary.com/definition/profit.htmlhttp://www.businessdictionary.com/definition/business.htmlhttp://www.businessdictionary.com/definition/economics.htmlhttp://www.businessdictionary.com/definition/land.htmlhttp://www.businessdictionary.com/definition/labor.htmlhttp://www.businessdictionary.com/definition/natural-resource.htmlhttp://www.businessdictionary.com/definition/capital.htmlhttp://www.businessdictionary.com/definition/produce.htmlhttp://www.businessdictionary.com/definition/innovation.htmlhttp://www.businessdictionary.com/definition/nation.htmlhttp://www.businessdictionary.com/definition/ability.htmlhttp://www.businessdictionary.com/definition/competitive.htmlhttp://www.businessdictionary.com/definition/global.htmlhttp://www.businessdictionary.com/definition/marketplace.html

  • Emphasizes the role of an imitator entrepreneur who does not innovate but imitates Technologiesinnovated by others. Are very important in developing economies.

    Albert Shapero

    : Entrepreneurs take initiative, accept risk of failure and have an internallocus of control.

    G. Pinchot

    : Intrapreneur is an entrepreneur within an already established organization. Definition of EntrepreneursToday

    Entrepreneurship is the process of creating something new and assuming the risks and rewards.

    Four aspects of being an entrepreneur today:

    1=Involves creation process.

    2=Requires devotion of time and effort.

    3=Involves rewards of being an entrepreneur.

    4=Requires assumption of necessary risks

    The Myths of Entrepreneur

    Myth 1: Entrepreneurs Are Doers, NotThinkers

    Myth 2: Entrepreneurs Are Born, Not Made

    Myth 3: Entrepreneurs Are Always Inventors

    Myth 4: Entrepreneurs Are Academic and Social Misfits

    Myth 5: Entrepreneurs Must Fit the Profile

    Myth 6: All Entrepreneurs Need Is Money

    Myth 7: All Entrepreneurs Need Is Luck

    Myth 8: Ignorance Is Bliss For Entrepreneurs

    Myth 9: Entrepreneurs Seek Success But Experience High Failure Rates

    Myth 10: Entrepreneurs Are Extreme Risk Takers (Gamblers

  • THE CONCEPT OF ENTREPRENEURSHIP

    Basically an entrepreneur is a person responsible for setting up a business or an enterprise.He has theinitiative , skill for innovation and who looks for high achievements. He is acatalytic agent of change andworks for the good of people . He puts up new green field projects that create wealth, open up manyemployment opportunities and leads to growth of other sectors .

    ENTREPRENEUR

    The word "entrepreneur" is derived from a French root entreprendre, meaning, "toundertake". The term"entrepreneur" seems to have been introduced into economic theory by Cantillon (1755) but Say (1803)first accorded the entrepreneur prominence. It was Schumpeter however, who really launched the field ofentrepreneurship by associating it clearly with innovation. Druckers definition of entrepreneurship,namely a systematic, professional discipline, brought a new level of understanding to the domainidentified two clusters of thought on the meaning of entrepreneurship. One group focused on thecharacteristics of entrepreneurship (e.g. innovation, growth, uniqueness) while a second group focused onthe outcomes of entrepreneurship (e.g. the creation of value).

    1=He is a person who develops and owns his own enterprise

    2=He is a moderate risk taker and works under uncertainty for achieving thegoal.

    3=He is innovative

    4=He peruses the deviant pursuits

    5=Reflects strong urge to be independent.

    6=Persistently tries to do something better.

    7=Dissatisfied with routine activities.

    8=Prepared to withstand the hard life

    9=Determined but patient

    10=Exhibits sense of leadership

    11=Also exhibits sense of competitiveness

    12=Takes personals responsibility

    13=Oriented towards the future.

    14=Tends to persist in the face to adversity

  • Convert a situation into opportunity. An entrepreneur is a person who starts an enterprise. He searches forchange and responds to it. A number of definitions have been given of an entrepreneur-The economistsview him as a fourth factor of production along with land labour and capital. The sociologists feel thatcertain communities and cultures promote entrepreneurship like for example in India we say thatGujaratis and Sindhis are very enterprising. Still others feel that entrepreneurs are innovators who comeup with new ideas for products, markets or techniques. To put it very simply an entrepreneur is someonewho perceives opportunity, organizes resources needed for exploiting that opportunity and exploits it.Computers, mobile phones, washing machines, ATMs, Credit Cards, Courier Service, and Ready to eatFoods are all examples of entrepreneurial ideas that got converted into products or services. Somedefinitions of an entrepreneur are listed below:

    Concept of Entrepreneurship

    Entrepreneurship involves decision making, innovation, implementation, forecasting of the future,independency, and success first and this is how enterprenuership developed Entrepreneurship is adiscipline with a knowledge base theory. It is an outcome of complex socio-economic, psychological,technological, legal and other factors. It is a dynamic and risky process. It involves a fusion of capital,technology and human talent. Entrepreneurship is equally applicable to big and small businesses, toeconomic and non-economic activities. Different entrepreneurs might have some common traits but all ofthem will have some different and unique features. If we just concentrate on the entrepreneurs then therewill be as many models as there are ventures and we will not be able to predict or plan, how and where,and when these entrepreneurs will start their ventures.

    Entrepreneurship is a process. It is not a combination of some stray incidents. It isthe purposeful and organized search for change, conducted after systematic analysis of opportunities inthe environment. Entrepreneurship is a philosophy- it is the way one thinks, one acts and therefore it canexist in any situation be it business or government or in the field of education, science and technology orpoverty alleviation or any others. Entrepreneurship can be described as a process of action anentrepreneur undertakes to establish his enterprise. Entrepreneurship is a creative activity. It is the abilityto create and build something from practically nothing. It is a knack of sensing opportunity where otherssee chaos, contradiction and confusion. Entrepreneurship is the attitude of mind toseek opportunities, take calculated risks and derive benefits by setting up a venture. It comprises ofnumerous activities involved in conception, creation and running an enterprise. According to

    Peter Drucker

    Entrepreneurship is defined as a systematic innovation, which consists in the purposeful and organizedsearch for changes, and it is the systematic analysis of the opportunities such changes might offer foreconomic and social innovation

    Entrepreneurship is a dynamic process of vision, change, and creation. It requires an application of energyand passion towards the creation and implementation of new ideas and creative solutions. Essentialingredients include the willingness to take calculated risks- in terms of time, equity, or career; the abilityto formulate an effective venture team; the creative skill to marshall needed resources; the fundamentalskills of building a solid business plan; and, finally, the vision to recognize opportunity where others seechaos, contradiction, and confusion

  • Entrepreneur is a per